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NCR Puts Up $1.65B For Mobile Banking Co.

02 December 2013

Business technology company NCR Corp. continued the transformation of its financial services branch Monday, announcing not only plans to pick up online and mobile banking solutions company Digital Insight Corp. for $1.65 billion but also the closing of its $84 million acquisition of fraud prevention software provider Alaric Systems Ltd.

The addition of both companies is a game changer for NCR's current capabilities in the banking industry, NCR Chairman and CEO Bill Nuti explained in a statement.

"This is a historic day for NCR," he said. "For the past eight years, NCR has been executing a deliberate and thoughtful strategic agenda to profoundly reinvent the company."

Between Digital Insight's online and mobile banking technologies and Alaric System's secure transaction switching and fraud prevention software, NCR is positioned to create a complete banking platform for retail banks and other financial institutions across all transaction platforms, including mobile, online, ATMs and branches, according to a statement.

"We have an opportunity to enable differentiated consumer experiences through safe, secure and integrated transactions across every banking touch point. We will help financial institutions to reduce costs, serving as a single solutions provider for ATM, branch, mobile, commerce and Internet banking services, as well as the payments and processing infrastructure behind those experiences," Andy Heyman, senior vice president of NCR Financial Services, said in a statement

California-based Digital Insight serves a highly diversified customer base consisting of more than 1,000 financial institutions with 12 million online banking users and nearly 4.8 million mobile users, according to a statement.

Alaric Systems, based in London, offers payment processing and fraud prevention software that allows financial institutions, processors and retailers to manage ATM, point of sale, e-commerce and mobile payments. The company powers an average of 1.25 billion transactions a month across 30 countries, according to a statement.

Last year, NCR remodeled its retail and hospitality businesses through the acquisition of Retalix Ltd. for roughly $650 million, following its $1.2 billion purchase of retail software provider Radiant Systems Inc. in 2011 in an effort to improve profitability and increase revenue with a mix of software and software as a service, according to a statement at the time.

Reflecting on NCR's growth through the four acquisitions, Nuti said in a statement Monday that the business technology company has fundamentally changed.

"Today represents a culmination of many years of effort, particularly as it relates to what was once NCR's core businesses," he said. "Today, we are fundamentally and permanently changing our largest line of business, Financial Services. With the announcements of our agreement to purchase Digital Insight and our acquisition of Alaric Systems, NCR becomes a powerful, global FinTech solutions provider enabling retail banks to deliver on the promise of omnichannel capabilities on top of an unparalleled, innovative software platform."

The acquisition of Digital Insight is expected to close in the first quarter of 2014 and is subject to normal closing conditions.

NCR is represented by Womble Carlyle Sandridge & Rice LLP. RBC Capital Markets LLC acted as lead financial adviser alongside JPMorgan and Bank of America Merrill Lynch.

Digital Insight's majority shareholder, Thoma Bravo LLP, was represented in the sale by Kirkland & Ellis LLP. The Kirkland team was led by corporate partners Gerald Nowak and Theodore Peto.

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